Nash Leasing Company agrees to lease equipment to Crane Corporation on January 1, 2020. The following information relates to the lease agreement. 3. The term of the lease is 7 years with no renewal 1. option, and the machinery has an estimated economic life of 9 years. The cost of the machinery is $541,000, and the fair 2. value of the asset on January 1, 2020, is $760,000. At the end of the lease term, the asset reverts to the lessor and has a guaranteed residual value of $45,000. Crane estimates that the expected residual value at the end of the lease term will be 45,000. Crane amortizes all of its leased equipment on a straight-line basis. The lease agreement requires equal annual rental 4. payments, beginning on January 1, 2020. 5. The collectibility of the lease payments is probable. Nash desires a 10% rate of return on its 6. investments. Crane's incremental borrowing rate is 11%, and the lessor's implicit rate is unknown. (Assume the accounting period ends on December 31.) Annual rental payment: 137605 Present value of minimum lease payments: 719748 Prepare the journal entries Crane would make in 2020 and 2021 related to the lease arrangement. (d) Prepare the journal entries Crane would make in 2020 and 2021 related to the lease arrangement. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter for the amounts. Round answers to decimal places es. 58.972. Record journal entries in the order presented in the problem Date Account Titles and Explanation Debit Credit 20 | (To record the lease.) (To record lease payment.) 20 (To record amortization) (To record interest.) 11/20 To record amortization) (To record interest.) Accounts Payable Accumulated Depreciation Buildings Accumulated Depreciation Leased Buildings Accumulated Depreciation Capital Lease Accumulated Depreciation Equipment Accumulated Depreciation Leased Equipment Accumulated Depreciation Leased Machinery Accumulated Depreciation Machinery Accumulated Depreciation.Right-of-Use Asset Advertising Experts Amortization Expense Airplanes Buildings Cash Cost of Goods Sold Deferred Gross Pront Deposit Liability Depreciation Expense Equipment Datory Costs Decutory Costs Payable Gain on Disposal of Equipment Gaon Disposal of Plant Assets Gain on sale of Buildings Insurance pense latrent Ewers Interest Payable Interesten inventory Land Led Asset Leased Buildings Leased Equipment Lease Expense Leaved Land Lease Lisbility Lease Receivable Lease Revenge Legal Expense Low on Capital Machinery Maintenance and Repairs Expense Notes Payable Prepaid Lastectory Costs Prepaide Fees Property Tax Expense Property Tax Payable Rent Expense Rent Payable Rent Receivable Rent Revenue Reversale-Leaseback Right-of-Use A Salaries and Wages Expense Sales Reve Selling Expenses Trucs Und Proton Sale-Lack Uende lever named Service Revenue